Category: Regulatory Compliance
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Service Level Auditing in Indonesia: How a Measured Standard Becomes a Competitive Position
Every enterprise believes it knows its own standard, and an unmeasured standard drifts until a guest sees the gap. A service level audit measures the standard an enterprise delivers against the one its market expects. This article shows, through an anonymised resort that measured too late, why a measured standard is a competitive position in… READ MORE →
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The Rise of PT PMDN, or the Return of Nominee Arrangements?
Bali’s restriction on foreign-owned companies has raised a fair question: stronger local business, or a return of nominee arrangements? The two are not opposites, and the channel the question overlooks is a lawful relationship between a foreign-owned company and an Indonesian-owned company. The Indonesian party owns the asset; the foreign company supplies services for a… READ MORE →
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PT PMA Restrictions in Bali: Why the Property Workarounds No Longer Work
Bali now blocks new foreign-owned company registrations in low and medium-low risk classifications, and the familiar workarounds no longer escape it. Switching to an accommodation code meets building-footprint and reserved-field limits. The fee-based management code reserves the broker role to Indonesian citizens. Nominee structures meet beneficial ownership disclosure. Each closure carries its own verification mechanism. READ MORE →
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Invoicing Offshore Clients from a PT PMA in Indonesia
The framework for invoicing offshore clients from a PT PMA in Indonesia: the PMK 32/PMK.010/2019 zero-rated VAT regime, corporate income tax at 22 per cent on worldwide income, Article 24 foreign tax credit, LLD reporting, and transfer pricing exposure under PMK 172/2023. READ MORE →
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What it Costs to Put an Employee on the Books in Indonesia
The headline gross salary is rarely the figure that arrives in a foreign owner’s monthly budget. After BPJS contributions, PPh Article 21 withholding, the THR reserve, and the payroll cycle costs, the fully-loaded cost of an Indonesian employee runs at 115 to 118 per cent of gross. READ MORE →
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Taking Money Out of a PT PMA: Dividends, Fees, Salary and Shareholder Loans
Four routes for extracting cash from a foreign-owned PT PMA: director salary, fees, dividends, and shareholder loan repayments. Worked tax comparisons with treaty rate examples on each. (185) READ MORE →
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Anti-Money Laundering Compliance for a PT PMA in Indonesia
AML compliance for a PT PMA sits alongside tax and forex in every outbound transfer decision. Indonesia’s full FATF membership from October 2023, PPATK reporting under Law 8/2010, sanctions screening, and beneficial ownership disclosure. READ MORE →
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Sending Money Offshore: Outbound Payments from a PT PMA
A foreign-owned PT PMA sends money offshore regularly: payments to suppliers, consultants, parent companies, and shareholders. Each transfer carries an Indonesian withholding obligation under PPh Article 26, a treaty rate application process, a Bank Indonesia reporting requirement, and a bank documentation set. READ MORE →
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Consultant Tax in Indonesia: PPh Article 23 and the Consultant-Employee Line
New foreign-owned PT PMAs frequently make a recurring error: paying the full consultant invoice without applying the withholding. This article works through the PPh Article 23 framework, the seven-factor consultant-employee substance test, the 2 or 4 per cent rate structure, and the NPWP rule. READ MORE →
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The Villa Question and the Line on Directors’ Personal Expenses
The villa question reaches nearly every foreign director running a Bali PT PMA in the first six months of trading. The 2023 reform to Indonesia’s benefit-in-kind regime under PMK 66/PMK.03/2023 changed the answer materially. Worked arithmetic on villa rent, vehicles, school fees, and KITAS costs. READ MORE →